Category: All Interviews

OPW INTERVIEW — Apr 21, 2006 — Craig Newmark is the founder of Craigslist.  He has built a powerhouse of a site on sheer utility, pure goodwill, and a groundswell of viral word-of mouth.  Craigslist is a phenomonen and Craig is one of my personal heroes. 

Why did you start Craigslist?
In 1994, I was at Charles Schwab; I was evangelizing the net for the brokerage industry.  I saw a lot of people helping each other out and I figured I should do some of that.  So, in early 1995, I started a simple 'cc' list telling friends about arts and technology events, and that was the beginning of Craigslist.  People asked for more stuff on the list and I did that and I got more feedback and I did that, and that's how it is today.  We talk to people, we find out what's needed, what's useful, and we do it.

Just how popular is it now?
We seem to be getting about 4 billion page views a month and we're in a little over 200 cities, in five countries with 8 million posts per month.

How is the international growth coming along?
It's slow but steady.  We are not where we want to be in terms of multiple language support.  But, word of mouth works and we're growing.

Why not charge for personals?
Five or so years ago, I asked people what it was they'd like us to charge for. The answer was to charge those people who would otherwise be paying more, for less effective advertising.  The consensus was to specifically charge for real estate and job postings.  So we charge brokers and recruiters and soon will charge apartment brokers for rental listings in NYC; although they specifically asked us to charge them to improve quality by reducing redundancy.  People have suggested we charge for personals as a way to improve quality; but there's no consensus.

What prompted the creation of the casual encounters, more racy personals section?
People saw that racy ads were being posted in the more conventional sections and people suggested we trade an alternative to get the racy ads focused in one or two places.  And that's been effective.

Have you been surprised by some of the posts?
These days, after about 13 years in San Francisco and going to the Fulsom Street Fair; not much surprises me.

What do you have in store for Craigslist and for the personals section in 2006?
We do need to improve customer service by giving more power to the people who use our site.  People can help us out by flagging inappropriate ads for removal.  We are driven by the culture of trust we've developed with our communities and that's another reason why I personally do full time customer service and I intend to do substantial customer service only as long as I live, after that, it's over !!

OPW INTERVIEW — Mar 31, 2006 — Michael Birch is the driving force and chief architect behind six community Web sites over the last decade. He launched his latest venture, Bebo.com, with his wife and brother in 2005. In seven months it attracted 22 million members and ranked as the largest social networking site for students in the U.K. Prior to Bebo he started Ringo.com, one of the first social networking sites, which was sold to Tickle.com. Birch earned his BS degree in Physics from Imperial College, London.  Now he has his sites on the U.S.!  Here's BEBOs story… – Mark Brooks

What is  BEBO's founding story?
BEBO was started in January, 2005 as a photo sharing – contact sharing website and we re-launched it in June 2005 as a social network.  I met my wife, Xochi, at the original site, a bar, in the UK when she was studying abroad and I was in college in the UK.  We thought it would be cool to create a social networking site around a global community of students in English speaking countries, and so that led to Bebo.  It proved very early on to be very popular with universities, colleges and schools, particularly in the UK, Ireland,  US, Canada, Australia and New Zealand.   

How big is BEBO now and how did you get it to grow so quickly?
BEBO has a total of 23 million registered members.  We're turning about 60 million page views a day and it's growing purely through word of mouth. We're growing incredibly quickly, setting new page view records every week now.  We've never done any marketing. The key to the success has really been creating a product that has proven to be popular. We spent a lot of time thinking before we started developing a product, how it should work and how to make it popular and what features to include and as importantly, what features to exclude from the finished product.  All the sites we've worked on in the past have always been focused on word of mouth marketing so that's kind of been our specialty.  We initially took that approach simply because we had no money to spend on marketing and word of mouth marketing is a
matter of time rather than money to get it right.

What other sites have you worked on in the past ?
We worked on a number of them since 1999.  It's been a matter of learning through trial and error.  So, we did 3 sites in the early days which had a mixed degree of success but never had the kind of exponential growth that's so critical.  The first one that actually took off was BirthdayAlarm.com, which is the web's largest birthday reminder service with eCards.  We monetized it, and with reminders as well as eCards it seemed to be very viable.  The second site that was successful was Ringo.com in 2003; Birthday Alarm was 2001.  Ringo was a very early social network.  We actually launched it 13 days following the day we heard about Friendster.  We started negotiating to sell the website 3 months later .  It was 6-months from launch to closing the sale-a very stressful time.  It took off very quickly, and after 2 months we had over 400,000 members.  At the time, Friendster had a million members.  We were second largest in the market at the time.  The reason we sold it, was that it was growing so quickly that we either had to get a VC or we had to sell it.  We couldn't afford to scale it.  We weren't profitable with Birthday Alarm at that time, the way we are now.

Why is BEBO better than MySpace or Friendster ?
The advantage of being late in the market is you have the benefit of hindsight.  So we managed to apply everything we learned from Ringo and analyzed what was and wasn't successful on Myspace.  So it was really just getting the product right and the subtle details of the product that make it work.  One of the major distinguishing factors is that from the start we've focused on schools and universities in 6 key English speaking countries-US, UK, IE, CA, AU & NZ.  Also. we offered, from the very beginning, unlimited
photo uploads.  I think we were the first social network to actually have no limitations on photos.   The other thing is that we offer the 'White Board,' where you can actually draw directly onto your home page.  The third is that we allow customizations through skins, rather than people having to write their own HTML to customize their page.  They can select new skins and their page can be updated through a click of a mouse.  We've struck the right balance between customization and personalization, without allowing members to break pages and create a bad user experience.   Bebo is fundamentally different from anything else that's come before it.

How do you see social networking evolving and where is the money to be made?
We're still in the relatively early days of social networking and if you look at the rate at which social networks are growing today, they are growing faster than they ever have.  Friendster was considered in the early days to be a fad, and now social networks are a huge order of magnitude larger than they were 3 years ago.  I think they still have a long way to go.  They are becoming much more, and will continue to be much more of a utility over time rather than being a pure gimmick, they're actually providing a genuine benefit.  For example, Bebo is a cultural phenomenon in Ireland, and a Beboer contacted us from Ireland and told us that before Bebo, the folks in his small town in Ireland were not getting along, and then everyone independently joined BEBO, and thanks to Bebo, they got to know each other and their friend's friends, and now there's a community spirit in the town pub that wasn't there before BEBO. 

In terms of making money, the leaders in the social networking space, to date, have been rather uncreative.  It's very early in this process and social networking creates a new advertising mechanism for brands to reach the tough to reach 13 to 30 year old demographic who are spending more time online and skipping TV commercials with TIVO.  Also, major brands will be able to do amazing word of mouth marketing campaigns on social networking sites that are only possible to do on social networking sites because influencers are already connected to all their friends.which makes the word of mouth that much easier.  But, you've got to engage this audience which means doing much more than the traditional banner advertising that's still the common form of advertising on SN sites.   

So, I think the income breakthrough hasn't happened with social networks yet, but it will happen in time.  The likely direction that will take will be with product sponsorships and product placements rather than traditional banner advertising.  The advertising and promotion needs to be more integrated into the social network itself, and targeted.  And, we're beginning to go in that direction with Bebo.

How is the partnership with Skype working out and was it the uptake like?
Skype is proving to be very popular on BEBO. We faced the option of developing that feature in-house, which is by no means a trivial application to develop, or to do it in partnership with someone else, so we chose Skype. Since we launched this co-branded partnership with Skype 3 months ago, 360,000 Beboers have added the Skype/Bebo co-brand to their homepage; and we're seeing 6,000 new Skype/Bebo registrations each day now.. 

What do you have in store for 2006-2007?
That's a long way ahead in terms of social networking.  The product road map is very aggressive.  We are aiming to making an improvement every week; which may be just a small feature or a major release.  We're doing this very carefully because we don't want to add features which are not popular.   One of the major features coming up is a music product.  We've been taking time to do this because we want to do this the right way and make sure we have the very best of breed. 

We're growing phenomenally quickly in the UK and Ireland.  I haven't actually seen the official figures, but the internal figures show that we're the largest single website in Ireland.  I'm doing radio interviews literally every day with radio stations in Ireland about the phenomenal growth of BEBO.  In the UK, we are probably ranked 25th in terms of overall websites, but we're growing at about 10% a week.  In the U.S. we are growing at a similar rate.   Our focus has been on the UK and Irish markets, and we're now just turning our attention to the US market as well.

OPW Interview — Mar 8, 2006 — The online personals market analysis companies that are quoted most often in the press are Comscore, Jupiter, Nielsen and Hitwise.  (I list the top 15 online personals site rankings from Comscore, Nielsen//Netratings and Hitwise on Online Personals Watch each month.  See the left bar.)  Hitwise has grown agressively over the last couple of years in the US.  You’ll see Bill Tancer quoted in the press as GM Research for Hitwise.  Here’s a more in depth interview with him on Hitwise and the online personals market. –Mark Brooks

What’s your background Bill?
I’ve been at Hitwise for two years and I’m the General Manager of the Global Research Group.  Before that I was the Director of Research at Looksmart. Prior to that, I headed up various market research groups at NBC internet, SNAP and Zaplet.  I also was a consultant for the Gartner Group covering the internet space before the dotcom boom.  Before that I was a trial lawyer in the US Navy.  I was always fascinated with technology.  In the Navy I was one of the first lawyers who used MILNET for email.  It was a one day round trip for a message.  The response would come into the communications department where an MP would take the response and put it on floppy disk and drive it to me. It was in 1995, after I moved to California and had finished my Navy commitment that I decided I wanted to work in the internet space.

Tell me more about your role at Hitwise?
I’m the GM of Global Research Group and head a team of analysts in Australia, UK and the U.S.  We have a couple of primary objectives for the research group.  Our first objective is to raise awareness for the company and for the concept of online competitive intelligence.  We do that by developing interesting applications for our data, writing about those applications, talking to the press and through speaking engagements.  We also work with our existing clients to help them find new ways to apply our data to make better, more informed business decisions.   

What are the top three ways Hitwise helps CEO’s make better decisions and make more money?
The first thing is just in understanding what your competitors are doing online.  There’s a ton of tools at any trade show floor that will help you analyze internal data, but not much out there to help you put all of your internal data in perspective.  That’s the #1 thing.  A close second would be our massive database of search terms that drive traffic to specific sites and categories, like the dating category.  With that data we can help our clients intercept their competitors’ traffic and drive it to their own websites.  #3 would be getting a high level overview of your space and the rest of the internet and using our data to make strategic decisions about the direction of your company. 

What do you think of the online dating space?
Online dating is a fascinating space and a great space for us to talk about. There has been an explosion in the number of sites in the dating category. We’re looking at 846 sites in the category.  At the same time we see the visits and market share of visits to the category is flat.  There’s a necessity to become more competitive.  Our data allows our clients to see where competitors are getting their traffic from and what kind of search strategy they have.  Also, the demographics and psychographics of visitors to competitors sites.  All of that together allows you to compete more effectively. 

What’s the state of the online dating market? 
If we take the category as a whole, it’s in the decline.  It’s interesting because I’ve been following the market since January 2004.  We were tracking 611 sites back then.  Now it’s the zenith.  In early to mid 2005 there were 918 sites.  Now, we’re down to 846.  There appears to be a bit of a shake out as well as a decline in market share of visits to the category as a whole.  So let’s take those 846 sites today.  If I take all visits, the online personals market will take 0.847% of all internet visits.  If I go back to the markets zenith in July 2005 it was at 1.2%.  We’re looking at how much the internet dating sector has grown in relation to the entire internet audience, which may also have grown.  If we take the top three dating sites, Yahoo! Personals has increased market share and Match and eHarmony are relatively flat.  The leaders in the space are increasing market share while the other sites shares are declining. The peak was due to the influx of all the niche dating sites.  As the major dating sites refine their search categories it negates the business models of the niche players.  The challenge for smaller players is to provide some kind of value-add in terms of content or user experience.  The other thing that I think we need to factor into dating is the ‘competitive substitute.’ The big one is social networking.  I need to mention Myspace.  This site is geared towards a younger audience and they use it for a number of purposes. Just looking at the rankings, Myspace is the 4th largest site on the internet.  It was getting 2.8% of internet visits.  In terms of market share it’s three times the size of the rest of the internet dating segment in terms of market share of visits. 

Where are the growth areas?
There’s two growth areas.  The younger and the older audience.  Online dating sites have a 25-34 demographic focus.  Myspace is strongly skewed to 18-24 year old visitors and represents a new paradigm in dating. We saw Friendster pick up and decline.  Myspace has picked up where Friendster left off.  This model caters to the younger audience.  All online dating players should be taking note of Myspace.  The 18-24 sector can be a predictor of what will happen for the rest of the online dating space.  Facebook has 0.15% of all internet visits so it’s more than a degree of magnitude smaller.  It’s also growing.  It’s had very steep growth from Nov 2004 to present. 

What are the latest developments with Hitwise?
We just launched a new search capability so our clients are now able to search for search terms by industry category and even by site.  I can tell you what site got what traffic on a particular keyword and dissect a competitive search category.  We’re coming out with a gap analysis tool within our search term intelligence service.  So, I can take another dating site and use this tool to compare search terms ‘gaps’.terms they are getting traffic on that I’m not.  I can compare with a custom category and get an optimized list.  We now cover 162 industry categories and we’re constantly refining and adding more functionality. 

OPW Interview — Feb 8, 2006 — Why are we abandoning users on online personals sites when they want to talk on the phone? They subscribe for email, IM, chat…and then they disappear from your revenue stream when they pick up the phone.  Anonymous calling services connect online personals sites with users, and satisfy their need for a safe anonymous means of communication. Phone Matrix has the most implementations and the slickest service I've seen.  They've been at it longer, had more experience than anyone else, and darn if it isn't available today, not tomorrow … they have an app. available now.

What does Phone Matrix do?
Phone Matrix has one very focused mission – delivering state-of-the-art anonymous phone contact services on personals sites.  It's our only business Mark – and it's what our PrivateCall product sets the standard of excellence for.  The people on our management team have unique backgrounds combining web development, telephony, dating and creative design.  We've pioneered phone introduction services since before the Internet was commercialized and also been long-time customers of the major dating sites. Anyone watching the industry closely over the last couple of years has seen the proof that you don't get the personals phone formula right by asking some engineer or a product manager to "build me a personals phone service please".  It's important to realize that from the moment that a fellow first lands on a site, then gets a gleam in his eye from spotting a great girl, to the time that we get them talking on the phone, involves dozens of very key elements of design, and if any are screwed up, you're going to lose a whole heap of potential business.  The formula for our PrivateCall service was born from our unique experience to maximize member participation and site
revenues.

Why do online dating users need to be connected anonymously?
Before daters arrange to meet face to face, they need to talk on the phone to get to know each other better.  But a lot of them, particularly the women, don't want to take chances with their safety.  After all, giving out your phone number, or having it show up on someone's call-display, can instantly expose your name and address to a total stranger.  So. there often needs to be a whole lot of back-and-forth messaging before a cautious dater will finally get on the phone and move ahead. But then you have a lot of busy guys out there, without propellers on their heads and with testosterone in their veins, who just don't feel they have the time to mess with all the keyboard courtship needed to finally get the ladies on the phone.  The guys just want to get to first base fast, and will do what it takes – and PrivateCall lets them play their field of opportunities much faster by eliminating the perceived telephone safety risk. That risk, by the way, is a lot greater than most folks realize.  Did you know Mark, that anyone can just call forward a regular phone to a toll-free service to see your number – even if you used call block?  Now that's a scary piece of stalker trivia.

Why should online personals companies care?
It's all about increasing market share and revenue. With the average personals customer registered on a couple of sites, there aren't any market gorillas out there that can act as if they have a captive audience.  The audience migrates to where they're being served most effectively.  And PrivateCall can play a key roll in that effective service. And obviously, why not tap into the revenue opportunity of those thousands of "first calls" between members that are happening every day?  When you consider that the install time of our PrivateCall service is measured in days, it's a no-brainer to move forward and quickly pick up on that revenue opportunity.

What kind of revenue increments should online personals companies expect from adding such services?
The amount of direct new revenue from PrivateCall is going to depend on the culture, demographics, size, and business model of each site.  As a rough rule of thumb, for most personals sites with reach ranks in the top twenty, you can figure that, on average, each premium male that's active in a week will generate roughly a dollar of net revenue for the site that week.  And since Phone Matrix's share of revenue typically covers all aspects of service delivery, including customer support and billing inquiries, payment processing, and chargeback responsibility, that dollar pretty much goes straight to the bottom line.

Do you have any new products in the pipeline?
Sure do!  Our product plan is mapped out to the 4th quarter.  But there are things that we all need to keep under our hats, and I'm sorry to say that you'll just have to have to wait for each launch Mark.